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US Justice Department cracks down on healthcare fraud linked to $2.75 billion loss

Posted on by Dsen .N

General Merrick Garland announces the results of a nationwide investigation into health care fraud at a press conference June 27 at the U.S. Department of Justice. Credit: Samuel Corum via Shutterstock.

The U.S. Department of Justice has charged 193 people in a sweeping enforcement action, accusing them of participating in $2.75 billion in health care fraud.

The two-week crackdown involved 76 doctors, nurses and other health care workers. The defendants are accused of several frauds, including illegally distributing millions of Adderall (amphetamine) tablets and other stimulants. It also involved fraudulent activities involving corporate executives distributing tainted and misbranded HIV drugs, resulting in losses of about $90 million.

Ruthia He, founder and CEO of San Francisco-based digital technology company Done Global, was arrested on June 13. He was charged with participating in a scheme to distribute Adderall (amphetamine/dextroamphetamine) over the Internet and conspiring to commit health care fraud in connection with submitting false claims for reimbursement for the drug and other stimulants. Adderall is a drug used to treat attention deficit hyperactivity disorder (ADHD).

Also involved were three pharmaceutical distributor executives who allegedly bought HIV drugs under fraudulent schemes and resold them to pharmacies across the country with forged documents, leading to patients unknowingly taking mislabeled drugs, and one losing consciousness for 24 hours after taking the wrong medication.

Attorney General Garland said in a statement: “It doesn’t matter whether you are a drug cartel dealer, an executive or a medical professional employed by a health care company. If you profit from the illegal distribution of controlled substances, you will be held accountable.”

Other cases include charges against two wound care company owners who allegedly accepted more than $330 million in bribes in a scheme to fraudulently bill Medicare for amniotic wound grafts – biological dressings that promote wound healing. In Arizona, prosecutors accuse a woman of improperly billing the state’s Medicaid agency for addiction treatment services that either provided no real benefit or were never actually provided.

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The agency said it also seized $230 million in cash, luxury vehicles, gold and other assets in connection with those cases, adding that the schemes resulted in losses of $1.6 billion.

“With this action, we as federal law enforcement officers are sending a clear and powerful message – that we will hold accountable health care providers and physicians who exploit their patients for profit and disregard the first principle of health care: do no harm,” said U.S. Secretary of Homeland Security Alejandro Mayorkas.